I’m 63, close to retirement, and none of my relatives lived past 82. I'm making $80,000/year — should I file for benefits now or is there a more ‘optimal’ age?

In 2023, about a third of the people who started taking Social Security were 66 years old, which is the full retirement age for their birth year.

Keep in mind that if you were born in 1960 or later, you don’t reach full retirement age until the year you turn 67.

What to consider before applying early

The most obvious downside to filing for retirement early is that your benefits will be reduced. At 63, Rick’s monthly benefit would be reduced by 25%.

The reduction percentage will be smaller each year he waits to claim benefits until reaching full retirement age. At that point he’ll be entitled to 100% of his benefits.

If, like Rick, you’re trying to decide whether to think strategically about when to claim your benefits, the Consumer Financial Bureau offers a tool that helps calculate how much you can expect to receive based on the age you start drawing benefits.

While many Americans like Rick may want to start drawing their benefits ASAP to enjoy them for as long as possible, longevity isn’t the only factor he should consider when making this important decision.

Determine cash needs. Someone still working full time may not need the extra money Social Security benefits would bring in right now. Plus, while under full retirement age, some of your benefits may be withheld according to your job earnings. The exact deduction will depend on how much you earn beyond a certain threshold.

Once you reach full retirement age, you keep all of your benefits without limitation from your earnings. If benefits were withheld before full retirement age, you can expect a higher monthly benefit after turning 67 to compensate for the months you didn’t receive a benefit because of high earnings.

Evaluate health. If you’re currently facing health difficulties, you may benefit from receiving your Social Security checks early. You can use them to pay for your medical expenses before you’re enrolled in Medicare. Be cautious, though, as medical complications may increase as you age.

Plan with your partner. If your spouse is still working, they may be making enough money to also cover your cost of living once you leave your job. That would allow you to delay receiving benefits. As a result, your payment amounts will increase when you start them.

If you’re the higher earner, consider the health of your other savings vehicles and retirement accounts. Drawing enough money from your 401(k) or IRA to cover the gap between when you stop working and reach full retirement age may be worthwhile. Although you’ll miss out on some interest growth from those funds, you guarantee yourself higher monthly benefits from Social Security or higher survivor benefits for your spouse if you pass first.

Finding the right benefits age for you

There’s no perfect answer when trying to determine the best age to start receiving Social Security benefits.